Israeli forces have shot and killed two Palestinian teenagers during an alleged stabbing in the occupied West Bank, as tit-for-tat violence and months of escalated tensions continue.

The two were shot dead while infiltrating Eli, a Jewish-only settlement in the central West Bank, and allegedly wounding a settler in a stabbing incident, the Israeli army said in a statement.

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"Two assailants infiltrated the community of Eli, south of Nablus. They attacked a man outside his home," the army said in a statement. "Forces arrived ... [and] shot the attackers resulting in their death."

According to a report by the Palestinian Ma'an News Agency, the boys, both 17, were Labeeb Azzam and Muhammad Zaghlawan from the nearby village of Qaryot.

Wednesday's incident came only a day after Israeli troops shot dead 22-year-old Eyad Omar Sajadiya, a Palestinian resident of the West Bank's Qalandiya refugee camp, during clashes sparked by an incursion into the camp.

Another 10 were injured during the clashes.

Upwards of half-a-million Israelis live in more than 150 Jewish-only settlements across the occupied West Bank, including East Jerusalem, according to the Israeli rights group B'Tselem.